Free Swag Disappears From Tim Hortons AGM As Company Focuses On Cost-Cutting

TORONTO - New CEO Daniel Schwartz told Tim Hortons Inc. shareholders on Wednesday that he's focused on building profits, cutting costs and improving efficiency at the coffee chain his company purchased last year.

That was evident at the company's annual general meeting on Wednesday -- the first since Restaurant Brands International Inc. took over the company in 2014 and installed new leadership.

The focus on efficiency was reflected at the meeting itself, a more informal affair than in years past, held at Restaurant Brand's office in Oakville.

Gone were the free boxes of donuts and cannisters of coffee for shareholders. Gone too were the ties for executives, at least for the youthful, 34-year-old Schwartz.

The CEO took the lead in laying out company business to a small group of investors in a brief and matter-of-fact manner, when in previous years different executives spoke at length about their individual responsibilities.

Schwartz told the shareholders that Restaurant Brands has a passion for same-store sales growth.

Shareholder Bill McNeice said the large and small changes the company is undergoing as Restaurant Brands makes its mark are acceptable as long as the new owners can show results.

"The main concern is that it's going to be run well, that it's going to be profitable, and that it's going to be here for a few years," he said.

Earlier this month, the company was briefly at the centre of controversy after it removed oil-sands advertisements from its in-store Tims TV service at some locations.

The issue wasn't mentioned at the meeting, and McNeice said it was best for the company to move on and stay away from such hot-button issues in the future.

Since unifying its Burger King operations with Tim Hortons in an $11 billion merger in August 2014, Restaurant Brands, which is majority owned by Brazilian hedge fund 3G Capital, has embarked on a series of moves to reduce overhead at the coffee chain.

In January, the new owners cut 350 jobs from Tim Hortons' head office, regional offices and distribution centres.

In February, the company reportedly put its six-seat Gulfstream 100 corporate jet up for sale.

Schwartz has said his plan for Tim Hortons is modelled on his restructuring efforts as CEO of Burger King, which Restaurant Brands bought for $4 billion in 2010.

Those plans include foreign expansion, in the United States as well as other countries in Europe, Asia and the Middle East.

Tim Hortons already has locations south of the border and overseas but the majority of its 4,500 Tim Hortons restaurants are in Canada.

Executives at Restaurant Brands have been outspoken about making Tim Hortons a global brand, though they faced criticism last year by some who perceived the merger to be hinged on relocating Burger King's head office to Canada for a lower tax bill, a move known as a corporate tax inversion.

Restaurant Brands, which reports in U.S. dollars, posted a loss of US$8.1 million attributable to shareholders in its most recent quarter on combined revenues of $932 million.

Same-store sales in the period were up 5.3 per cent for Tim Hortons, which Schwartz said Wednesday was the chain's "best result in years."